Vermont Statutes Title 8 Sec. 6048h
Terms Used In Vermont Statutes Title 8 Sec. 6048h
- Commissioner: means the Commissioner of Financial Regulation. See
- Contract: A legal written agreement that becomes binding when signed.
- Person: shall include any natural person, corporation, municipality, the State of Vermont or any department, agency, or subdivision of the State, and any partnership, unincorporated association, or other legal entity. See
- Reinsurance contract: means a contract between a special purpose financial insurance company and a ceding insurer pursuant to which the special purpose financial insurance company agrees to provide reinsurance to the ceding insurer for risks associated with the ceding insurer's insurance or reinsurance business. See
- Special purpose financial insurance company: means a captive insurance company that has received a license from the Commissioner to operate as a special purpose financial insurance company pursuant to this subchapter. See
- Special purpose financial insurance company security: means :
- State: when applied to the different parts of the United States may apply to the District of Columbia and any territory and the Commonwealth of Puerto Rico. See
- Surplus note: means an unsecured subordinated debt obligation possessing characteristics consistent with paragraph 3 of the National Association of Insurance Commissioners Statement of Statutory Accounting Principles No. See
§ 6048h. Securities
(a) A special purpose financial insurance company may:
(1) subject to the prior approval of the Commissioner, account for the proceeds of a surplus note issued by the special purpose financial insurance company as surplus; and
(2) submit for prior approval of the Commissioner periodic written requests for authorization to make payments of interest on and repayments of principal of surplus notes and other debt obligations issued by the special purpose financial insurance company, provided that the Commissioner shall not approve such payment if the Commissioner determines that such payment would jeopardize the ability of the special purpose financial insurance company or any other person to fulfill his or her respective obligations pursuant to the special purpose financial insurance company securitization agreements, the reinsurance contract, or any related transaction. In lieu of approval of periodic written requests for authorization to make payments of interest on and repayments of principal of surplus notes and other debt obligations issued by the special purpose financial insurance company, the Commissioner may approve a formula or plan, which shall be included in the special purpose financial insurance company’s plan of operation as amended from time to time, for payment of interest, principal, or both with respect to such surplus notes and debt obligations.
(b) In addition to the provisions of section 6005 of this chapter, no dividend or distribution may be declared or paid by a special purpose financial insurance company if such dividend or distribution would jeopardize the ability of the special purpose financial insurance company or any other person to fulfill the company’s or other person’s respective obligations pursuant to the special purpose financial insurance company securitization agreements, the reinsurance contract, or any related transaction.
(c) A special purpose financial insurance company security shall not be subject to regulation as an insurance or reinsurance contract. An investor in such a security or a holder of such a security shall not be considered to be transacting the business of insurance in this State solely by reason of having an interest in the security. The underwriter’s placement or selling agents and their partners, commissioners, officers, members, managers, employees, agents, representatives, and advisors involved in an insurance securitization by a special purpose financial insurance company shall not be considered to be insurance producers or brokers or to be conducting business as an insurance or reinsurance company or as an insurance agency, brokerage, intermediary, advisory, or consulting business solely by virtue of their underwriting activities in connection with such securitization. (Added 2007, No. 49, § 17; amended 2013, No. 29, § 59, eff. May 13, 2013.)